Bitcoin price could easily slide 7%, but will BTC bulls sit by idly?
- Bitcoin price has slipped below the ascending parallel channel setup, denoting a breakout.
- BTC could retest the four-hour EMA and SMA at $22,861 and $23,199, respectively, before sinking to $21,286.
- Invalidation of the bullish thesis would involve a flip of the four-hour SMA at $23,199 into a support floor.
Bitcoin (BTC) price shows a clear sign of consolidation below the long-term consolidation structure. While the bearish outlook has not yet been confirmed, bulls should not rest, knowing that another crash could occur soon.
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Bitcoin price continues to tighten
Bitcoin price has been in a rangebound movement since the Silvergate crisis-led crash on March 2. This sudden sell-off has knocked BTC below the ascending parallel structure seen in the chart below.
While a breakdown of this structure forecasts waning bullishness and even a bearish move, more confirmation is required. In the meantime, market participants can expect Bitcoin price to trigger a recovery rally that tags the four-hour Exponential and Simple Moving Averages (EMA, SMA) at $22,861 and $23,199, respectively.
A rejection here will be the first step for bears to seize control. A swift spike in selling pressure could collapse Bitcoin price to the next key support level at $21,625. In some cases, this move could wick down to the 200-day EMA support at $21,268.
Bitcoin price could tag the 200-day SMA at $19,716 in a worst-case scenario.
BTC/USDT 1-day chart
On the other hand, if the recovery bounce causes Bitcoin price to produce a daily candlestick close above the $23,199 hurdle into a support floor, it would invalidate the bearish thesis. However, investors should wait for a secondary confirmation, which will arrive after BTC flips the $25,000 psychological level into a foothold.
In such a case, Bitcoin price could eye the next major hurdle at $28,000.
Author
Akash Girimath
FXStreet
Akash Girimath is a Mechanical Engineer interested in the chaos of the financial markets. Trying to make sense of this convoluted yet fascinating space, he switched his engineering job to become a crypto reporter and analyst.
